It's a long way from the dusty western Saharan city of Laayoune to Manhasset in leafy New York state, but these very different places were linked this week by a flare-up of violence and a new round of slow-moving international diplomacy.

Exactly what happened in the desert territory remains in dispute between the Saharan independence movement, Polisario, and the Moroccan government, fighting for the past 35 years over one of the most inhospitable places on Earth.

Polisario's version is that Moroccan security forces stormed a protest camp near Laayoune, killing 11 civilians and injuring hundreds. Video images show fear and chaos as police jeeps advance and helicopters hover overhead. Aminatou Haidar, the "Gandhi of the Sahara", accused Rabat of deliberate provocation and a crime against humanity. Morocco said eight of its personnel were killed.

Amnesty International has called for an independent inquiry into the area's worst violence in years.

What is not in doubt is that the clashes took place, by accident or design, on the eve of the latest session of negotiations exploring ways to break the logjam.

It began in 1975, when Morocco's King Hassan launched his "Green March" to occupy western Sahara, evacuated by Spain after nearly a century – in effect decolonising it out of existence.

Polisario's founders were inspired by UN recognition of their right to self-determination and by that other unequal struggle, of the Palestinians against Israel. Like the Palestinians, Sahrawis talk of occupied territories, settlers (Moroccans from outside the Sahara), an indifferent world, and the need for protection from a superior enemy.

Hassan's nationalist flourish, combining a claim of historic rights and tribal fealties with a hard-headed appraisal of the territory's rich phosphate deposits and offshore fishing grounds, triggered 16 years of war. Neighbouring Algeria, bastion of anticolonialism and third world solidarity, backed Polisario's ragtag guerrillas, who fought the western-equipped Moroccan army to a deadlock and a UN-brokered ceasefire in 1991.

What had been a cause celebre in the 1980s faded from view as hopes for a negotiated solution became mired in disagreements about how to conduct a UN-backed referendum.

In 2003, the UN proposed giving the Sahara autonomy under Moroccan sovereignty pending a referendum, a position Polisario reluctantly accepted, even though it fell short of its demand for full independence.

Since then Rabat has turned against the idea. The US supports Morocco's position, though critics say that unlike France, it does not do so explicitly enough. Internationally, Spain is the country most critical of the Moroccans, and the Spanish media cover the western Sahara story closely. The Spanish prime minister, José Luis Rodríguez Zapatero, expressed his "deep concern" about the situation this week.

Morocco's official spin is that the conflict is over, though there is plenty of evidence of its use of repression, violence, unfair trials and other abuses. In addition, tens of thousands of Sahrawi refugees still live in miserable camps in Tindouf, across the border in south-western Algeria.

Gdeim Izik, the makeshift camp at the centre of this latest drama, was set up by the Sahrawis last month to protest against the lack of job opportunities and discrimination. Moroccan officials and media labelled its leaders "criminals" and "killers" who were committing acts of vandalism and holding residents against their will.

Amnesty quoted witnesses as saying the security forces forced their way in, beating people and using teargas and water cannons to push them out of tents, which were then set alight or bulldozed. Foreign journalists were kept away, ensuring a fairly effective news blackout.

The suspicion is that the Moroccan raid was timed to undermine the talks that were due to start at a secluded estate in Manhasset the following day – the third round of a UN-sponsored process overseen by a former US diplomat, Christopher Ross, the UN secretary-general's personal envoy for western Sahara.

Morocco's foreign minister, Taib Fassi Fihri, insisted his country was "ready and open" to negotiations but dismissed calls for a referendum that would include what he called the "outdated" concept of Saharan independence. Agreement would require "compromise and realism", he warned. Those qualities again look in short supply.

Ross spoke of a "new dynamic" in the Manhasset meeting but admitted each side "continues to reject the proposal of the other as a basis for future negotiations". The good news is Morocco and Polisario have agreed to meet again in December. And so another "peace process" limps on.